Millions make retirement trade-offs to fund university costs, research finds

Millions of parents and grandparents expect to make sacrifices to their retirement plans in order to support children and grandchildren through university, according to research from Rathbones.

A survey of 1,010 parents and grandparents helping to fund education costs found that 26% expect to retire on a lower standard of living than originally planned, while 24% said they will have to delay retirement.

The research also found that 17% said they expect to reduce pension contributions as a result of supporting university costs.

Among those anticipating a later retirement, 43% said they expect to work for at least three additional years, including 11% who believe they will need to postpone retirement by more than five years.

Rebecca Williams, financial planning divisional lead at Rathbones, said: “It’s completely understandable that parents want to give their children the best possible start in life — and for many, that still means university.

“But it shouldn’t come at the cost of their own financial security.

“Education is a worthwhile investment, but it’s important to be clear on the long-term cost and to balance that with your own plans.”

Williams said concerns about the impact of education costs on long-term wealth and retirement planning were increasingly common among clients.